Singapore: Asia-Pacific ministers warned on Wednesday that the global economic crisis was far from over and a current upturn was a respite rather than recovery.
Ministers from the Asia-Pacific Economic Cooperation forum (APEC) have gathered in Singapore for meetings that will culminate in a weekend summit that US President Barack Obama will attend.
Obama, in an interview with Reuters, said he would work with China on his Asian visit to address the economic recovery and trade imbalances.
After foreign and trade ministers met for breakfast on Wednesday, Singapore’s representative George Yeo said they had discussed the global economic recovery, reform of financial institutions and resisting protectionism.
He said the consensus among ministers was that the global economic crisis was “by no means over”.
“The upturn that we now have is a respite. The situation is still fragile. We should still address the root cause of the problem,” he said.
Finance ministers from the 21-member Pacific rim group have a separate meeting on Thursday and, according to a draft statement, will pledge to keep up economic stimulus plans.
World Bank President Robert Zoellick said he was comfortable about world growth prospects this year, but saw downside risks for 2010 and recommended governments keep stimulus measures in place through next year.
“Recovery globally is not going to be symmetrical. It’s going to be at a different pace,” he told a World Bank conference in Singapore on Wednesday.
The trade and foreign ministers also have other issues on their agenda -- including ways to mitigate the impact of climate change by promoting energy efficiency.
Foreign ministers from five of the six countries involved in North Korea diplomacy are attending, including US secretary of state Hillary Clinton, and could talk about ways to restart the nuclear disarmament process on the sidelines.
Free trade models
But the centrepiece - or the elephant in their room, depending on various outlooks - is free trade.
They will look at various models for an Asia-Pacific free trade area, which leaders of the group could then discuss at their weekend summit in Singapore.
“We will continue to put in place building blocks towards a possible Free Trade Area of the Asia-Pacific (FTAAP) in the future,” said a draft declaration to be issued by APEC economic ministers this week and obtained by Reuters.
The key word there is “possible”.
APEC member economies account for 40% of the world’s population across four continents, more than half of global gross domestic product and nearly half of world trade.
But their members range from relatively poor countries such as Papua New Guinea, Peru and the Philippines, emerging markets such as Indonesia, Thailand and Malaysia, and rich economies, including the United States and Japan.
They all have different ideas about the pace and extent of open trade and investment.
The United States, by far the biggest economy, needs to show leadership in APEC, US Chamber of Commerce president Thomas Donohue said in an address in Singapore.
“You can’t lead and stand on the sidelines at the same time,” Donohue said, noting some 168 free trade agreements are in force in Asia on Wednesday.
APEC’s industrialized countries have yet to reach open trade goals set 15 years ago with a deadline of next year, even as the they ponder an ambitious free trade area, officials said.
The “Bogor Goals”, adopted at the 1994 Asia-Pacific Economic Cooperation summit in Bogor, Indonesia, called for industrialized members to achieve free trade and investment targets by 2010 and for developing member economies to do so by 2020.